v3.25.2
GOODWILL, INTANGIBLE ASSETS INCLUDING DIGITAL ASSETS AND USDC
 3 Months Ended
Mar. 31, 2025
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL, INTANGIBLE ASSETS INCLUDING DIGITAL ASSETS AND USDC

NOTE 4 – GOODWILL, INTANGIBLE ASSETS INCLUDING DIGITAL ASSETS AND USDC

 

The Company’s intangible assets consist of the following:

 

          
   March 31,
2025		   December 31,
2024		 
Acquisition-related intangible assets  $2,243,822   $2,332,506 
Digital assets   78,399    85,653 
Total intangible assets, net  $2,322,221   $2,418,159 

 

Goodwill and Acquisition-Related Intangible Assets

 

As of both March 31, 2025 and December 31, 2024, the Company’s goodwill balance was $3,866 thousand. Goodwill resulted from the acquisition of ITSQuest and thus is included in the Company’s TaaS segment. There were no impairment charges related to goodwill. During the three months ended March 31, 2025 and 2024.

 

Acquisition-related intangible assets consisted of the following as of March 31, 2025 and December 31, 2024:

 

Schedule of finite-lived intangible assets                              
          March 31, 2025  
    Useful
life		     Gross
carrying
amount		     Accumulated
amortization		     Net
carrying
amount		  
Intangible assets with finite lives:                              
Customer Relationships   15 years     $ 3,011,000     $ 869,845     $ 2,141,155  
Trade Names   5 years       770,000       667,333       102,667  
          $ 3,781,000     $ 1,537,178     $ 2,243,822  

 

          December 31, 2024  
    Useful
life		     Gross
carrying
amount		     Accumulated
amortization		     Net
carrying
amount		  
Intangible assets with finite lives:                              
Customer Relationships   15 years     $ 3,011,000     $ 819,661     $ 2,191,339  
Trade Names   5 years       770,000       628,833       141,167  
          $ 3,781,000     $ 1,448,494     $ 2,332,506  

 

Amortization expense related to intangible assets was $89 thousand for each of the three months ended March 31, 2025 and 2024. As of March 31, 2025, estimated future amortization was as follows:

 

Schedule of amortization expense        
Schedule of amortization expense:   Amortization  
2025 (since April 1, 2025)   $ 253,217  
2026     200,733  
2027     200,733  
2028     200,733  
2029     200,733  
Thereafter     1,187,673  
Total   $ 2,243,822  

 

Digital Assets

 

The Company records the initial cost basis of digital assets at their original purchase price or the then-current quoted market prices (e.g., if received in an exchange rather than through purchase) and presents all digital asset holdings as indefinite-lived intangible assets in accordance with ASC 350, Intangibles—Goodwill and Other, except USD Coin. The Company performs an analysis to identify whether events or changes in circumstances, principally decreases in the quoted prices on active exchanges, indicate that it is more likely than not that our digital assets are impaired. In determining if an impairment has occurred, we consider the quoted price of the digital asset. If the then current carrying value of a digital asset exceeds the fair value so determined, an impairment loss has occurred with respect to those digital assets in the amount equal to the difference between their carrying values and the prices determined.

 

During the three months March 31, 2025 and 2024, the Company received digital assets as consideration from investors for the purchases of unicoin rights, common stock and private placement unsecured notes issued by the Company. These digital assets included Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Litecoin (LTC), Tether (USDT) and Wrapped Ethereum (WETH). Unicoin rights are more fully discussed in Note 6. The Company utilized $109 thousand and $358 thousand of its digital asset holdings for vendor payments during the three months ended March 31, 2025 and December 31, 2024, respectively.

 

During the three months ended March 31, 2025 and 2024, the Company recorded $0 thousand and $6 thousand, respectively, of impairment losses on such digital assets. Impairment losses are included in operating expenses in the condensed consolidated statements of operations and comprehensive loss. During the three months ended March 31, 2025 and 2024, there were no sales of digital assets thus no realized gains or losses were recorded.

 

The table below summarizes the carrying values and activity for the Company’s digital asset holdings as of March 31, 2025 and 2024:

 

               
    March 31,
2025		     March 31,
2024		  
Bitcoin (BTC)   $ 78,399     $ 1,544  
Tether     -       1,965  
Ethereum (ETH) and Wrapped Ethereum (WETH)     -        11,051  
Total   $ 78,399     $ 14,560  

 

Schedule of digital assets activity                                        
                      Three Months Ended
March 31,		  
    Bitcoin     Ethereum     USD Coin     2025     2024  
Beginning balance   $ 78,399     $ 7,254     $ -     $ 85,653     $ 1,254  
Received as consideration in sales of unicoin rights     -        -       5,020       5,020       29,582  
Vendors payments     -        -       (109,054 )     (109,054 )     (28,338 )
Received as consideration in sales of common stock     -        -       26,134       26,134       -  
Proceeds from disposal of digital assets     -        (7,254 )     89,361       82,107       -  
Payments from customers     -        -       -       -       17,810  
Write-off     -        -       -               (5,752 )
Fees and other     -        -       (11,461 )     (11,461 )     4
Ending balance   $ 78,399     $ -     $ -     $ 78,399     $ 14,560  

 

The market value of the Company’s digital assets, based on quoted prices on active exchanges, was approximately $78 thousand and $86 thousand as of March 31, 2025 and December 31, 2024, respectively.